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Keeping up with the latest mortgage trends

HOW TO TALK TO MORTGAGE LENDERS?

How To Talk to Mortgage Lenders?

It can be challenging to speak to a mortgage lender if you do not know what points to bring up or questions to ask. You should prepare to speak to mortgage executives at different types of institutions, such as a bank, a lender, and a broker. In a purchase situation, the first meeting should be to interview the representative to see if you trust them and to see what you qualify for. If you are looking to refinance, a first meeting should be to determine what rates are available to you.

 

I. FINDING A LENDER

1. Talk to a lender before you start house hunting. Mortgage paperwork can take a long time to process. You will want to start looking for lenders and rates before you decide on your house or else you might lose out on it.[1] Having a mortgage preapproved will make the entire process smoother and faster. Furthermore, some real estate agents may reject offers from buyers without a mortgage preapproved.[2]

  • Since rate locks attach to a property and not an individual, you cannot lock an interest rate until you have a contract on the property.

2. Contact different types of lending institutions. Banks, credit unions, and online lenders, and brokers all offer mortgages. Consult different websites to find which ones may be willing to offer you a better deal. While you can visit banks and credit unions in person, you may have to call an online company.

  • Be careful with online lenders. While you may find a reputable one that offers a good deal, you are also likely to encounter more scams.[3]

3. Make appointments with several lenders. The best way to get a good deal on your mortgage is to talk to several lenders. You can get a feel for their different personalities and your comfort level with each of them. This will let you compare rates, fees, and contracts.[4]

4. Research common terms and conditions. You may not know yet what kind of mortgage you need, but you can familiarize yourself with the terms and types of mortgages that your lender may talk to you about. These terms include:

  • Interest rate: the cost you pay to borrow the loan. The interest rate is a percentage of the loan. You pay this on top of the money you owe to repay the loan.
  • Annual Percentage Rate (APR): how much you will pay every year year for the loan. This includes fees and interest.[5]
  • Adjustable Rate Mortgage (ARM): a mortgage with interest rates that change over time. Rates may start low and then increase. This may be fine if you are planning to sell the house after a few years.
  • Fixed Rate Mortgage: a mortgage with interest rates that do not change over time. This is ideal if you want to stay in the same house for the full length of the mortgage.
  • Hybrid Adjustable Rate Mortgage: a mortgage that has fixed fees for the first year or two. After this point, the rates may change.[6]

II. DISCUSSING YOUR OPTIONS

1. State your budget. When you first meet with a lender, you will want to inform them of what you think your budget is. Tell them roughly what price range of house you are looking for. They will take this into consideration after you’ve made an application.

  • Say something along the lines of: “Right now, I am looking at houses in the $250,000 range, but I want to make sure that I qualify to borrow that much money first.”
  • Listen carefully to what they say. Ask questions about anything you are uncertain about or don’t know.

2. Ask questions about the loan. You want to make sure that there are no hidden fees or rules in your contract, and you want to understand fully what the mortgage process will be like. You can ask:

  • “How much will the down payment be? How much are closing costs?”
  • “What is the APR? How much will I be paying every year, including fees, penalties, and interest?”
  • “How long does it take to process a mortgage?”
  • “Do you offer fixed-rate or adjustable rate mortgages?”
  • “What will happen if I fall behind on my payments?”
  • “Are there prepayment penalties?” In other words: “Will I be charged fees if I pay off my mortgage early?”[7]
  • “What documents and information do I need to provide you?”[8]

3. Determine what extra fees you will be paying. There are many other fees that are tacked onto mortgages. While the bulk of your conversation will be about the interest rate and payment plan, be sure to ask your lender about what other charges they will incur. Ask directly: “In addition to my interest rate and monthly payment, what other fees am I responsible for?” Ask them to break down these fees and their purpose. These include:

  • Origination fees: these are the fees your lender will charge you for creating the loan.
  • Discount points: these are the difference in yield between your chosen rate and the par rate.
  • Closing costs: these are the fees you pay when the deed transfers to you.[9]
  • Note that this is the only stage of the process where the lender can legally negotiate with you. If you are haggling over actual rates, which are set 60 days in advance, you may be dealing with someone unsavory.

4. Compare offers before agreeing on a deal. Once they give you a rate, know that without locking the rate in, it can change at any time. You need a property to lock in the rate. Accepting this fluidity, inform them that you want to compare deals with other lenders and that you will get back to them shortly.

  • You can say, “I have a few more meetings set up with other banks, but I will let you know as soon as possible what my decision is.”
  • If the lender tries to pressure you into signing a loan right away, resist. They are using predatory tactics to coerce you into getting a bad loan.[10] Simply state: “I do not feel comfortable signing onto a loan before I have explored my options.” If the lender pushes you, stand your ground. Say: “I am not going to sign this loan yet. While I appreciate the deal, I do not like being pressured into a loan.”

5. Watch out for predatory loans. You want to be absolutely aware of common scam tactics. Read all documents carefully, and go over the fine print. Ask a lawyer to help you. Some common predatory tactics include:

  • Blank spaces in documents. You should say: “I do not feel comfortable signing papers that have blank spots in them. Please fill in these spots, and resubmit the contract to me.”
  • Offering extremely low interest rates at the beginning and increasing them substantially after a certain point. This is known as ballooning. You should say: “I would rather pay slightly higher fees throughout the mortgage at a fixed rate. Can we negotiate this?”
  • A statement in the contract that prohibits you from suing them in the future. Say: “I do not feel comfortable with this clause. I will not waive my right to sue.”
  • If the lender will not budge on these points, walk away. They are not a reputable lender.[11]
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How To Become A Mortgage Loan Officer?

Loan Officers, also referred to as “Mortgage Loan Originators,” are people who work for banks and other financial institutions with the main objective to recommend individual and business loan applications for approval and participate in the front end of the mortgage origination process.

 

Loan officers help people procure loans for houses and businesses helping people buy houses and other types of real estate. All mortgage officers must be licensed by the federal and state governments, which requires extra educational coursework and testing. Applying your knowledge gained through certification and licensing, as well as getting the necessary experience, will help you become a mortgage loan officer.

PART 1: Completing Education and Gaining Experience

Earn a high school diploma or GED. Earning a high school diploma, or earning a GED, is the first step toward become a loan officer. Try taking math and accounting classes, if available, to lay the foundation for the tools you will need to be an effective loan officer. Most four-year undergraduate require a high school diploma or GED in order to apply for a position as a student.

Apply for an internship or assistant-ship. Applying for an internship or assistant-ship, although not required, will give you experience and expose you to potential practical applications of your knowledge. Try interning for a mortgage loan originator to get hands on experience with financial documents and the day to day workings of the job.

 

Earn a bachelor’s degree in a business related field. Since most loan officers generally analyze businesses or individuals applying for credit, you will need to understand general business accounting, like understanding how to read financial statements. Earning a degree in a related field, such as business, finance, economics, or accounting, will give you the relevant information to be able to perform as a mortgage loan officer.[1]

  • Check to see if your school offers any specific courses on topic concerned with being a mortgage loan officer.

Receive a loan officer certification. Although not required, getting a loan officer certification can show dedication and expertise, which can ultimately strengthen your chances of being hired. Many banking associations, like the American Bankers Association or the Mortgage Bankers Association, as well as many schools and universities offer certification programs.[2]

  • Apply for a certification with banking associations through their online portals.[3]
  • Consult the registrar at your local community college or university to see if they have any certification courses available.

 

PART 2: Obtaining a Federal License

Check your state’s licensing requirements. Each state has different requirements for licensing and certification. Checking which state requires which license or certification will give you a better understanding of what your next course of action should be. Consult loan officer state licensing guides to easily access your state’s requirements.[4]

Complete your Nationwide Mortgage Licensing System coursework. All state licensed Mortgage Loan Originators (MLOs) require a pre-licensure education called SAFE that consists of 20 hours of coursework. The coursework can be broken down into 3 hours of federal law and regulation, 3 hours of ethics, including fraud, 2 hours of training standards, and 12 hours of undefined mortgage origination instruction.[5]

  • Consult the NMLS to find your state’s course provider or to find courses offered online.[6]

Pass all required NMLS testing. There are 1-2 test components you’ll need to pass once you have finished your education. The first is the National component, the second, the State. Some Some states accept just the national test and others require both national and state. Both components require a fee before you are allowed to take them.[7]

  • If you fail, both tests have a waiting period that varies by state before you can retake the test. You can retake the test(s) as many times as you want but each time the waiting period will increase.
  • Consult the NMLS testing handbook to fully understand the test structure before you take both test components.[8]
  • A minimum score of 75% is required to pass both tests, and both tests have a waiting period of 30 days before you can retake them. However, you can retake the tests as many times as you need.[9]

Get a criminal background check. In order to complete your criminal background check you will need to pay the fee associated with processing and schedule a fingerprinting. Getting a criminal background check will ensure your future employers of your trustworthiness and will bring you one step closer to being a loan officer.

  • You can pay your fee and schedule a fingerprinting through NMLS’ online portals.[10]

Have a credit report through NMLS. Have your credit evaluated by a third party or by the NMLS. This evaluation will be based on your history; they are looking for quality of character as evidenced by financial decisions. Your credit report can be submitted through an online portal on the NMLS’ website.[11]

  • Credit report fees cost approximately $15.00.

Apply for a job as a mortgage loan officer. Once you have passed and acquired all of the requirements you are ready to start applying for positions to become a mortgage loan officer. Research job openings online, write a resume and cover letter, request letters of recommendation from previous employers, and start submitting applications.[12]

  • Consult a past professor or previous boss to see about potential job openings or resources.

At Superior Mortgage Co., Inc., we specialize in residential and commercial loans and provide the best products and services available. Whether you are purchasing, refinancing or in need of a home equity loan, and regardless of any credit problems, we can help you. Contact the company that can answer all your questions. Call us at 845-883-8200.

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What NOT to Do During a Recession

In an uncertain economy or an actual recession, you may be facing important decisions such as whether to purchase a car, invest in a risky stock, or become a cosigner for a family member. There are financial risks that everyone should seriously reconsider during risky economic times, including:

 

  • Becoming a Cosigner: Even in the best of times, cosigning on a loan is very risky. If the person taking out the loan forgets to make a payment or is consistently late with their payments, it is your credit history that will be impacted and you could also be asked to make those payments. In an economic downturn, the risks are much greater since the person taking out the loan can lose their job. If you feel you have no choice and must cosign for a loan, it is important to set aside some money in case the worst happens.

 

  • Taking out an Adjustable-Rate Mortgage: When buying a new home, you may choose to take out an adjustable-rate mortgage (ARM). In many cases, this may be a good move, especially if interest rates remain low. If the economy begins to falter, and you lose your job and interest rates increase, your monthly payments will increase. Late payments or non-payments will have an adverse impact on your credit rating, making it difficult to obtain a loan in the future.

 

  • Taking on Debt: Taking out a loan for a car or home may not be a problem when the economy is doing well as long as you make enough money to cover your monthly payments and contribute to your retirement savings. However, if the economy takes a turn for the worse, your risk goes up, especially if employment is not stable. If you are considering adding additional debt to your financial portfolio, this could complicate your financial situation if you become unemployed or your income is reduced. In a worst-case scenario, you could even be on your way to declaring bankruptcy.

 

  • Taking Your Job for Granted: In an economic slowdown, even large corporations can come under financial pressure. While this may simply mean cutting out the open bar at the holiday party, it could also mean cutting the shareholders’ dividends or laying people off. Most jobs become vulnerable during a recession so employees should do everything they can to make sure their employer maintains a positive opinion of their work product.

 

  • Taking Risks with Investments: It is important to always be thinking about the future by investing money. However, a shaky or uncertain economy may not be the best time for an increased level of risk. For example, taking on a new loan to purchase a second home or to add another floor to your home may not be the best idea if the economy is uncertain. If business slows, which can happen during a recession, you may not have enough money at the end of the month to pay your installments on time.

Contact the Mortgage Company with All the Answers

Superior Mortgage Co., Inc. knows everything about residential and commercial loans and offers a wide range of products and services to give you the best options for your mortgage loan. Call Superior Mortgage Co., Inc. at 845-883-8200 or email sales@superiormci.com for additional information.

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Fair Housing Rights for First Time Buyers

Looking for your first home can be an exciting time. It can also be a frustrating time if your efforts to find your perfect house are blocked by unfair or unscrupulous practices. Under the Fair Housing Act, housing discrimination is illegal in almost all housing whether it is private, public, or housing funded by the federal government.

Although the Fair Housing Act covers most housing, it does not cover single family homes sold or rented by the owner without the assistance of a real estate agent, housing belonging to religious organizations, private clubs that do not allow occupancy unless you are a member, and owner-occupied buildings with under four units.

Discrimination is Illegal

HUD’s Office of Fair Housing and Equal Opportunity (FHEO) is committed to ending housing discrimination and promoting economic opportunity through their housing laws. If you think that you may have been denied housing because of your race, gender, family status, national origin, color, disability, or religion, in violation of fair housing laws, you can file a complaint with the FHEO. 

Some examples of discriminatory practices may include:

  • Refusing to rent or sell property;
  • Denying that housing is available;
  • Evicting you without due cause;
  • Discouraging you from buying or renting;
  • Harassing you;
  • Retaliating against you because you filed a complaint;
  • Imposing different sale prices or rent charges based on your protected status;
  • Attempting to stop you from renting or buying by using threats, coercion, or intimidation; and,
  • Delaying or ignoring maintenance requests.

Housing providers must make reasonable accommodations and can modify or replace existing structures to help disabled individuals, and certain multifamily housing must be accessible to people who are disabled through the Americans with Disability Act (ADA).

Discriminatory Mortgage Lenders

Mortgage lenders, such as Superior MCI, are committed to providing fair and equitable loans and other financial assistance to people who are looking for the perfect mortgage for their family. The Fair Housing Act also makes it illegal for any mortgage company to refuse to provide information on loans or impose different points, fees, or interest rates based on race, gender, family status, national origin, color, disability, or religion. 

Contact Superior Mortgage Co., Inc.

Superior Mortgage Co., Inc., specializes in residential and commercial loans. We provide a wide range of products and services as well as the best products and services available. Regardless of whether you want to purchase a first home, vacation home, or commercial property, we can help. If you are interested in refinancing your home or need a Home Equity Line of Credit (HELOC), we can help. Even if your credit is not where you want it to be, contact the mortgage company to obtain the information you need to make the best decision. Call us at 845-883-8200 or email sales@superiormci.com. We look forward to hearing from you.

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4 Things Every First-Time Home Buyer Must Do in Advance

Life takes you to amazing places, but it is your love that gets you home. Are you ready to buy your first home? It is natural to feel the stress, as you are taking one of the most important steps in your life. Let’s make your experience of first home buying worth the biggest and best purchase of your life.

1. Make Your Own Budget

Imagine, you are interested in buying a home, but the price quoted is unaffordable. It may leave you heartbroken. If you try to cobble up finances, it may add to your stress. Therefore, a first home buyer must determine the affordability before selecting a property. 

Start with your salary and find out how much you can repay monthly. Another important thing for a first-time homebuyer to consider is the down payment.  

The availability of online loan calculators makes it easier to plan your finances and get a clear idea of the amount to pay. It is advisable to restrict your mortgage liabilities to 30% of your income.

2. Consider Down Payment Assistance

The down payment varies from 3 to 20 percent of the house price. If you have not enough savings, explore the option of down payment assistance. Go through the details of eligibility, the pros, and cons of any such federal, state, county, and nonprofit program.

The assistance covers part of the payment or the full down payment. It can be of three types.

  • Down payment grants: You don’t have to repay the amount.
  • Forgivable second mortgage: It comes with zero-percent interest or a deferred repayment. 
  • Matched savings programs: It is a kind of matching grant. 

Check the eligibility, conditions, recapture period, and requirements, such as credit score and the debt-to-income ratio.

3. Get Ready for the Mortgage 

To apply for a mortgage, the first thing you need is a good credit score. It has a bearing on both the loan approval and the interested rate to be offered. Start by checking your credit reports. Even you can use online or offline resources to verify your credit score. If you see any discrepancy, get it corrected. Pay your balances and avoid the card for two billing cycles. Don’t apply for new cards until you buy your own house. It helps improve the score.

Next is preparing all your documents. You need to have the W-2 income statement by your employer, bank statements, and paystubs in order. If you are into a profession or business, you need last three tax returns to submit.

4. Start Mortgage Shopping

Contact different banks and lenders for mortgage pre-approval. It is free and does not impose any liability. Analyze the terms each offer. Consider both fixed and adjustable interest rates based on your tenure and the prevailing economic condition. Never forget to ask about mortgage fees. Ask them the charges for preparing documentation. Check both online and with local banks to see the difference between various mortgage quotes.

The excitement as a first-time homebuyer is discernible and you have a lot to think and do before finalizing your preferred home. With a proper, step-by-step plan, you can make it easy, free from any hassle, and an exhilarating experience to share with others.

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3 Things Every First-Time Home Buyer Should Do in Advance

Are you ready to buy your first home? It is natural to feel the stress, as you are taking an important step.  Make your experience of first home buying worthy of one of the biggest and best purchases of your life.

1. Determine Affordability Before Selecting a Property

Start with your income and figure out how much you can repay monthly. Another important thing for a first-time homebuyer to consider is the down payment.  

The availability of online loan calculators makes it easier to plan your finances and get a clear idea of the amount to pay. It is advisable to restrict your mortgage liabilities to 30% of your income.

2. Get Ready for the Mortgage 

To apply for a mortgage, the first thing you need is a good credit score Start by checking your credit reports. Use available resources to verify your credit score. If you see a poor rating, correct it. Pay your balances and avoid the card for two billing cycles. Don’t apply for new cards until you buy your own house. It helps improve the score.

Next prepare your documents. You need to have your tax information such as W-2 income statement by your employer, bank statements, and paystubs in order. If you own a business, you need to submit your last three tax returns.

3. Start the Mortgage Process

Consider checking with Superior MCI before you look anywhere else. We will be happy to meet with you and offer you the best rates available.

The excitement in being a first-time homebuyer is real. There is a lot to think about and do before finalizing your home purchase. With a step-by-step plan, you can make it easier, free from any hassle, and an exhilarating experience to share with others.

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First Time Home Owner Series: Should a Starter Home be Your Dream Home?

Just because you can afford a 2,500-square-foot home sitting on an acre lot doesn’t mean you should buy it. When shopping for a starter house, some first-time buyers will get pre-approved for a mortgage and then shop based on the maximum they can borrow. If the mortgage company said they can afford it, then why not go for the home at the top of the budget? But doing that can create a bad financial situation if the homeowner is struggling to pay the mortgage each month or if all of the money is tied up. If all of your money goes to maintain your home, you may quickly accumulate debt.

Experts say it’s best to stay in the home you purchase for five to seven years to recoup the costs and to see some return on your investment. Purchase a property you can afford. Instead of going all-in with your first home, opt for a more affordable starter home that won’t break the budget and leaves room for entertainment or unexpected life expenses that will undoubtedly arise.

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First Time Home Owner Series: What Features Should You Look For?

What are your basic desires concerning a home? Are you looking for a large kitchen? A big backyard? Lots of rooms to grow a family. 

What type of neighborhood do you want to live in? A quiet neighborhood – or one that is bustling with stores and people on the street late at night?

This may be the largest purchase you make in your life. You’ll want it to be one that you will be happy with for a long time. You deserve to have it fit both your wants and needs as closely as possible.

View lots of homes, and as you do, be flexible but keep your basic list of needs and wants firmly in mind. Don’t settle for a house just because it’s convenient. When it’s right you’ll know it.

At Superior Mortgage Co., Inc., we specialize in residential and commercial loans and provide the best products and services available. Whether you are purchasing, refinancing or in need of a home equity loan, and regardless of any credit problems, we can help you. Contact the company with the answers you need. Please call us at 845-883-8200. We look forward to hearing from you.

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First Time Home Owner Series: What Type of Home Are You Looking For?

Consider your long-term goals. Do you want the freedom and independence of owning your own home? Would you rather make mortgage payments instead of paying rent to a landlord? With your own home, you are your own property owner.

What options are there when purchasing a residential property? 

Consider these:

  • Traditional single-family home
  • Duplex
  • Townhouse
  • Condo
  • Co-op (housing cooperative)
  • Fixer-upper (Careful! This can wind up costing more than you bargained for)

Each of these options has pros and cons which need to be considered carefully in light of your goals.

At Superior Mortgage Co., Inc., we specialize in residential and commercial loans and provide the best products and services available. Whether you are purchasing, refinancing or in need of a home equity loan, and regardless of any credit problems, we can help you. Contact the company with the answers you need. Please call us at 845-883-8200. We look forward to hearing from you

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First Time Home Owner Series: Who Is A First Time Home Buyer?

According to HUD (US Department of Housing and Urban Development, a first-time homebuyer should be one of the following:

  • Someone who has not owned a principal residence for 3 years
  • A single parent who only owned a home with a spouse – while married
  • A displaced homemaker who only owned with a spouse
  • An individual who has only owned a principal residence not permanently affixed to a permanent foundation in accordance with applicable regulations.
  • An individual who has only owned a property that was not in compliance with state, local or model building codes—and which cannot be brought into compliance for less than the cost of constructing a permanent structure.

Principal Residence: 

A principal residence is a primary location that a person inhabits. It does not matter whether it is a house, apartment, trailer, or boat, as long as it is where an individual, couple, or family household lives most of the time.

At Superior Mortgage Co., Inc., we specialize in residential and commercial loans and provide the best products and services available. Whether you are purchasing, refinancing or in need of a home equity loan, and regardless of any credit problems, we can help you. Contact the company with the answers you need. Please call us at 845-883-8200. We look forward to hearing from you.

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